Relief as food prices drop

Consumers can afford a smile after commodity prices recorded a drop after last month’s fall in annual inflation.The country’s annual inflation has been witnessing a downward trend since June as it eased to 5.92 per cent, from 8.3 per cent in May, before declining to 5.57 per cent in July pushing commodity prices down. In a mini survey conducted by The New Times around the Kigali city market in the central business district, showed that food commodity prices have registered a decline since June this year. “I can now buy more foodstuffs using the same amount of money compared to May and June which I think is helping us as consumers,” Juliet Kantengwa told Business Times late last weekAccording to a mini-survey by Business Times, a kilogramme of onions fell to Rwf 500 up from Rwf1000, cassava fell to Rwf190 from Rwf200, Matooke went down to Rwf 120 from Rwf 150, while vegetables remained at Rwf 100. Jacqueline Mukanyandwi, a vendor at Kimironko market, said the decline in prices resulted from good harvests which pushed supply to surpass demand. “When there is enough supply, the prices tend to go down and if you see commodities whose prices have fallen, it is an indication that farmers they had a good season,” she said The Central bank says that the recent fall in food prices by 11.35 percent in June from 15.47 per cent in March pushed domestic inflation down further to 6.75 per cent in June from 9.65 per cent the previous month.According to NISR, the fall triggered a general inflation rate by an annual average of 7.3 per cent in July with prices of food and non-alcoholic beverages, housing, water, electricity, gas and other fuels also falling.“In annual change, the increase in the general index of 5.57 per cent is mainly due to the rising prices of food and non alcoholic beverages of 10.38 per cent and housing, water, electricity, gas and other fuels of 6.31 per cent which contributed an additional 3.76 percent and 1.31 percent, respectively,” NISR reports. Experts say that if the current trend of decline in inflation is maintained, there is a likelihood of ending the year below the Central bank’s projections of 7.5 per cent inflation by December this year.Permanent Secretary in the Ministry of Agriculture, Ernest Ruzindaza, attributes this to the good performance of season A of this year that saw agricultural production increase by 10 per cent. “What we are doing now is to invest in productivity and also consider the whole value chain,” he said. “We want to link our production to the market so that we can complete the whole chain”.Rwanda is perceived as a food basket for the region indicating a need to boost production to meet the demand for agricultural exports while retaining enough for local consumption.

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Relief as food prices drop